Swiss Rates Can Be Lowered Further, SNB President Says
(Bloomberg) -- The Swiss National Bank can lower its subzero interest rates even further, President Thomas Jordan told newspaper Blick.
In the interview, Jordan affirmed the ongoing need for a deposit rate of minus 0.75 percent plus a pledge to intervene in currency markets, if necessary, adding the franc remains highly valued. The SNB had the tools to act, he said, should economic conditions deteriorate.
“We always have the possibility of lowering rates further. We have already gone quite far, but still we’ve got the necessary room to maneuver,” he was quoted as saying in comments published in Saturday’s Blick. “And we can, if necessary, expand the balance sheet further via interventions.”
The SNB’s interest rates are the lowest of any major central bank and are designed to keep pressure off the franc, which is regarded as a safe haven at times of market uncertainty. A strengthening franc depresses the inflation rate in Switzerland.
Jordan made comments to the same effect earlier this month in Washington.
“If we come to the conclusion that it’s necessary to fulfill our mandate, then of course we’re ready to use our monetary policy instruments.”
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